Question 1

If you purchase a $110,000 and make a 10% down payment,how much would 1 point cost at closing?

Accepted Answer

A)  $ 765 
B)  $ 990 
C)  $1,100 
D)  $1,530 
E)  $1,800 
A)  $ 765 
B)  $ 990 
C)  $1,100 
D)  $1,530 
E)  $1,800

Question 2

One can increase the tax benefits of homeownership by selecting a shorter term mortgage,for example 15 years rather than 30 years.

Accepted Answer

A) True 
 B)False

Question 3

The seller of the house typically pays the

Accepted Answer

A)  loan application fee. 
B)  real estate agent's commission. 
C)  appraisal fee. 
D)  points. 
E)  title search and insurance. 
A)  loan application fee. 
B)  real estate agent's commission. 
C)  appraisal fee. 
D)  points. 
E)  title search and insurance.

Question 4

The interest rates and monthly mortgage payments will not change over the life of your mortgage;you have a(n)

Accepted Answer

A)  reverse-annuity mortgage. 
B)  fixed-rate mortgage. 
C)  adjustable rate mortgage. 
D)  rollover mortgage. 
E)  graduated-payment mortgage. 
A)  reverse-annuity mortgage. 
B)  fixed-rate mortgage. 
C)  adjustable rate mortgage. 
D)  rollover mortgage. 
E)  graduated-payment mortgage.

Question 5

Auto purchases (rather than leasing)accounts for about ____ percent of all vehicles sold today.

Accepted Answer

A)  55 
B)  60 
C)  75 
D)  80 
E)  95 
A)  55 
B)  60 
C)  75 
D)  80 
E)  95

Question 6

At the end of your car lease period,you intend to turn in the car,and you will not pay extra at that time based on the residual value of the car.You have ____ lease.

Accepted Answer

A)  a residual 
B)  an open-end 
C)  a purchase option 
D)  a closed-end 
E)  none of these 
A)  a residual 
B)  an open-end 
C)  a purchase option 
D)  a closed-end 
E)  none of these

Question 7

Most lenders do not want mortgage payments plus other debt payments to exceed ____ percent of your gross monthly income.

Accepted Answer

A)  10-15 
B)  15-18 
C)  25-30 
D)  30-33 
E)  33-38 
A)  10-15 
B)  15-18 
C)  25-30 
D)  30-33 
E)  33-38

Question 8

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement.
-With a(n)[closed-end | open-end] lease,one owes more at the end of the lease if the car is worth less than its projected value at the end of the lease.

Accepted Answer

The answer of INSTRUCTIONS: Choose the word or phrase in...

Question 9

A loan-to-value ratio of 80 percent would require a buyer to make a 20% down payment.

Accepted Answer

A) True 
 B)False

Question 10

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement.
-Most lenders do not want your monthly installment loan payments to exceed [36 | 50] percent of your monthly income.

Accepted Answer

The answer of INSTRUCTIONS: Choose the word or phrase in...

Question 11

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement.
-It would make sense to purchase a vehicle at the end of a close-end lease period if the residual value in the lease agreement was [more | less] than the car's market value.

Accepted Answer

The answer of INSTRUCTIONS: Choose the word or phrase in...

Question 12

The first step in the auto-buying process should be

Accepted Answer

A)  test drive several cars. 
B)  begin negotiations. 
C)  consider alternative buying strategies. 
D)  decide whether to trade in your used car or to sell if yourself. 
E)  analyze how much car you can afford. 
A)  test drive several cars. 
B)  begin negotiations. 
C)  consider alternative buying strategies. 
D)  decide whether to trade in your used car or to sell if yourself. 
E)  analyze how much car you can afford.

Question 13

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement.
-The Real Estate Settlement Procedures Act [limits the amount of closing costs a lender can charge | requires advance disclosure of closing costs].

Accepted Answer

The answer of INSTRUCTIONS: Choose the word or phrase in...

Question 14

Swimming pools are home improvements that generally enhance the resale value of a home dollar for dollar.

Accepted Answer

A) True 
 B)False

Question 15

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement.
-A convertible ARM will have a [higher | lower] interest rate than a traditional ARM.

Accepted Answer

The answer of INSTRUCTIONS: Choose the word or phrase in...

Question 16

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement.
-With a [closed-end | open-end] lease,you turn in the car at the end of the term and have no additional financial obligation as a result of the residual value.

Accepted Answer

The answer of INSTRUCTIONS: Choose the word or phrase in...

Question 17

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement.
-Used cars sold by [private individuals | super stores] typically cost less.

Accepted Answer

The answer of INSTRUCTIONS: Choose the word or phrase in...

Question 18

An inflation hedge is an asset that increases in value at a rate equal to or greater than the rate of inflation.

Accepted Answer

A) True 
 B)False

Question 19

Dick and Jane (and their dog Spot)have just purchased a house and are calculating how much money they will need when the closing day rolls around.The purchase price is $200,000.They will make a 20% down payment,and they must pay 2 points on the loan.Closing costs should be 3% of the purchase price.What is the total dollar amount they will need at closing? (Show all work. )

Accepted Answer

The answer of Dick and Jane (and their dog Spot)have...

Question 20

In which of the following situations would you have to pay additional money when returning a vehicle using a closed-end lease?

Accepted Answer

A)  residual value is less than expected 
B)  residual value is more than expected 
C)  mileage limits were exceeded 
D)  a and c 
E)  b and c 
A)  residual value is less than expected 
B)  residual value is more than expected 
C)  mileage limits were exceeded 
D)  a and c 
E)  b and c

If you purchase a $110,000 and make a 10% down payment,how much would 1 point cost at closing?

One can increase the tax benefits of homeownership by selecting a shorter term mortgage,for example 15 years rather than 30 years.

The seller of the house typically pays the

The interest rates and monthly mortgage payments will not change over the life of your mortgage;you have a(n)

Auto purchases (rather than leasing)accounts for about ____ percent of all vehicles sold today.

At the end of your car lease period,you intend to turn in the car,and you will not pay extra at that time based on the residual value of the car.You have ____ lease.

Most lenders do not want mortgage payments plus other debt payments to exceed ____ percent of your gross monthly income.

A loan-to-value ratio of 80 percent would require a buyer to make a 20% down payment.

The first step in the auto-buying process should be

Swimming pools are home improvements that generally enhance the resale value of a home dollar for dollar.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement. -A convertible ARM will have a [higher | lower] interest rate than a traditional ARM.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement. -Used cars sold by [private individuals | super stores] typically cost less.

An inflation hedge is an asset that increases in value at a rate equal to or greater than the rate of inflation.

In which of the following situations would you have to pay additional money when returning a vehicle using a closed-end lease?

Understanding the Financial Planning Process

Your Financial Statements and Plans

Preparing Your Taxes

Managing Your Cash and Savings

Using Credit

Using Consumer Loans

Insuring Your Life

Insuring Your Health

Protecting Your Property

Investment Planning

Investing in Stocks and Bonds

Investing in Mutual Funds

Planning for Retirement

Preserving Your Estate

Filters

Exam 5: Making Automobile and Housing Decisions

If you purchase a $110,000 and make a 10% down payment,how much would 1 point cost at closing?

One can increase the tax benefits of homeownership by selecting a shorter term mortgage,for example 15 years rather than 30 years.

The seller of the house typically pays the

The interest rates and monthly mortgage payments will not change over the life of your mortgage;you have a(n)

Auto purchases (rather than leasing)accounts for about ____ percent of all vehicles sold today.

At the end of your car lease period,you intend to turn in the car,and you will not pay extra at that time based on the residual value of the car.You have ____ lease.

Most lenders do not want mortgage payments plus other debt payments to exceed ____ percent of your gross monthly income.

A loan-to-value ratio of 80 percent would require a buyer to make a 20% down payment.

The first step in the auto-buying process should be

Swimming pools are home improvements that generally enhance the resale value of a home dollar for dollar.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement. -A convertible ARM will have a [higher | lower] interest rate than a traditional ARM.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement. -Used cars sold by [private individuals | super stores] typically cost less.

An inflation hedge is an asset that increases in value at a rate equal to or greater than the rate of inflation.

In which of the following situations would you have to pay additional money when returning a vehicle using a closed-end lease?

Understanding the Financial Planning Process

Your Financial Statements and Plans

Preparing Your Taxes

Managing Your Cash and Savings

Using Credit

Using Consumer Loans

Insuring Your Life

Insuring Your Health

Protecting Your Property

Investment Planning

Investing in Stocks and Bonds

Investing in Mutual Funds

Planning for Retirement

Preserving Your Estate

Filters